Kenneth Chau & Co. welcomes the recent budget speech of The Hong Kong Financial Secretary (“FS”) on February 22, 2017. The FS has announced the 2017/18 Budget, outlining the government’s plans for the economy and public finance.
A brief summary of the Hong Kong Budget 2017-18:
| Economic Outlook for 2017
· Forecast GDP growth of 2% to 3% · Forecast headline inflation of 1.8% and underlying inflation of 2% |
| Major Tax and Relief Measures highlights
· Profits tax rate for incorporated companies remain unchanged at 16.5% · Introduce profits tax concession to promote aircraft leasing and financing · No change in the standard tax rate and progressive tax rates of Salaries tax · Widen the marginal tax bands from HK$40,000 to HK$45,000 · Waive 75% of profits tax for 2016/17 (subject to HK$20,000 ceiling) · Waive 75% of salaries tax and tax under personal assessment for 2016/17 (subject to HK$20,000 ceiling) |
Fact sheet of Hong Kong Tax Rates 2017-18 and 2016-17:
| 2017-2018 | 2016-2017 | |
| Salaries Tax rates | ||
| First HK$45,000 (16/17:HK$40,000) | 2% | 2% |
| Next HK$45,000 (16/17:HK$40,000) | 7% | 7% |
| Next HK$45,000 (16/17:HK$40,000) | 12% | 12% |
| On the remainder | 17% | 17% |
| Standard rate | 15% | 15% |
| Property Tax rates | ||
| Tax rate | 15% | 15% |
| Profits Tax rates | ||
| Companies | 16.5% | 16.5% |
| Unincorporated businesses | 15% | 15% |
*** The above measures will be effected upon passage of the legislation.
***(Source from: http://www.budget.gov.hk/2017 )